Luận văn thạc sĩ quản trị kinh doanh quốc tế MBA (108)

GRIGGS UNIVERSITY GLOBAL ADVANCED MASTER OF BUSSINESS ADMINISTRATION PROGRAMS CAPSTONE PROJECT REPORT “Build business strategy in the period of 2011-2015 for Military Commercial Joint Stock Bank - Dien Bien Phu Branch” Group Number: 01 Nguyen Ngoc An Do Thu Ha Hoang Thi Thu Hien Nguyen Minh Hung Pham Thi Huong HA NOI 2011 COMMITMENT We here by commit: The capstone’s content is our actual research, which has been implemented on the basis of theoretical research, real situation of the bank Data and figures of the capstone are true Given strategies and solutions start from our practice and experience Once again, we confirm the truthfulness of the above commitment! i ACKNOWLEDGEMENT We faithfully thank all teachers of the program In order to complete this graduate program and capstone, we have received wholehearted and enthusiastic guidance, assistance and criticisms of all teachers Thank the Management Bank of Military Commercial Joint Stock Bank, Dien Bien Phu Branch and colleagues who have wholeheartedly exchanged views, offered suggestions and provided data and figures to us ii TABLE OF CONTENTS CONTENTS Page Commitment i Acknowledgement ii Table of content iii List of tables and figures vi List of abbreviations viii INTRODUCTION CHAPTER 1: GENERAL THEORETICAL FOUNDATIONS OF BUILDING BUSINESS STRATEGY 1.1 Theories of strategy and strategic management 1.1.1 Concept of strategy 1.1.2 Bases of strategy 1.1.3 Basic steps of strategic management 1.1.3.1 Stage of planning strategy 1.1.3.2 Stage of implementing and inspecting strategy 10 1.2 Analysis of environmental factors 12 1.2.1 Analysis of macro environment – PEST Model 12 1.2.1.1.Politics 13 1.2.1.2 Economics 1.2.1.3 Socioculture 1.2.1.4 Technology 14 14 15 1.2.1.5 Integration 15 1.2.2 Analysis of the environment of sectors - Micheal Porter’s Five 16 Forces Model 1.2.2.1 Competitive pressures from the suppliers 1.2.2.2 Competitive pressures from customers 1.2.2.3 Competitive pressures from potential competitors 1.2.2.4 Competitive pressures from substitute products 1.2.2.5 Competitive pressures in the internal 1.2.3 Analysis of the internal environment 17 17 18 18 18 18 1.3 Establishment of SWOT matrix and selection of business strategy 20 CHAPTER 2: ANALYSIS OF ENVIRONMENT FACTOR AND 24 iii SELECTION OF BUSINESS STRATEGY FOR MB DIEN BIEN PHU BRANCH 2.1 Overview about MB and MB Dien Bien Phu Branch 24 2.1.1 Overview about MB 2.1.2 Overview about MB Dien Bien Phu branch 2.2 Analysis of environmental factors 24 276 351 2.2.1 Analysis of external factors 351 2.2.1.1 Analysis of macro environment according to PEST model 3531 2.2.1.2 Analysis of environment of the sector according to 4737 model of M Porter 2.2.2 Analysis of internal factors of MB Dien Bien Phu 5942 2.2.2.1 Primary operations 5942 2.2.2.2 Supporting activities 6850 2.2.2.3 Comparison correlation between MB Dien Bien Phu and 7153 other bank 2.3 Establishment of SWOT matrix and selection of business strategy 7656 CHAPTER 3: SOLUTIONS FOR IMPLEMENTATION OF BUSINESS 8560 STATEGY OF MB DIEN BIEN PHU BRANCH BY 2015 3.1 Business goals of MB Dien Bien Phu by 2015 8560 3.1.1 The common goals 3.1.2 Specific goals 3.2 Strategy implementation solutions 8560 8560 8762 3.2.1 Organization of network and structure 3.2.2 Build up corporate culture 3.2.3 Human resource development solution 3.2.4 Marketing Solution 3.2.5 Information Technology Solution 3.2.6 Service and products solution 3.2.7 Mobilization and lending solution 3.2.8 Risk management solution Recommendation: Conclusion 8762 8862 8863 8964 9065 9165 9165 9267 9468 9670 References 9771 Appendix 99 iv LIST OF TABLES, FIGURES No Name of tables, figures Pag e Figure 1.1 Simulation of military strategy Figure 1.2 Simulation of business strategy Figure 1.3 The strategic management process Figure 1.4 The model of the working steps in the strategic planning stage 10 The model of the working steps in the strategic implement 11 Figure 1.5 stage Figure 1.6 The working steps in the strategic assessment stage 12 Figure 1.7 The model of competitive forces 16 Figure 1.8 The diagram of SWOT matrix 20 The organization and operation structures of MB 25 Figure 2.1 Table 2.2 Bank The basic targets of MB Bank in the period 26 (2008-2010) Figure 2.3 The organization structure of MB Đien Bien Phu 28 Table 2.4 The business results of MB Đien Bien Phu 31 Table 2.5 The GDP growth speed and inflation of Vietnam 36 v Table 2.6 37 The socio-economic targets in the first months of 2011 compared to the same period of 2010 Table 2.7 The matrix of external elements EFE 58 Table 2.8 The structure of mobilized capital of MB Dien Bien Phu 61 Table 2.9 The lending situation in MB Dien Bien Phu 62 Table 2.10 Structure of lending outstanding MB Điện Biên Phủ 63 Table 2.11 IFE matrix of MB Dien Bien Phu 70 Table 2.12 Table 2.13 The table comparing MB Dien Bien Phu with 72 some competitors in the sector The table comparing MB Dien Bien Phu with some 73 competitors in the sector ( no credit) Table 2.14 Matrix SWOT 76 Table 2.15 QSPM Matrix of MB Dien Bien Phu 83 Table 3.1 85 The growth objectives of MB Dien Bien Phu ( 2011 – 2015) LIST OF TABLES AND FIGURES No Tables and figures Page Figure 1.1 Simulation of military strategy Figure 1.2 Simulation of business strategy Figure 1.3 Process of strategic management Figure 1.4 Model of steps in the stage of planning strategy 10 Figure 1.5 Model of steps in the stage of implementing strategy 11 Figure 1.6 Model of steps in the stage of evaluating strategy 12 Figure 1.7 Model of five competitive forces 16 Figure 1.8 Diagram of SWOT matrix 20 Figure 2.1 Organizational structure of MB 25 Table 2.2 Primary indicators of MB period 2008-2010 26 Figure 2.3 Organizational structure of MB Dien Bien Phu 27 vi Table 2.4 Business results of MB Dien Bien Phu 30 Table 2.5 GDP growth rate and inflation of Vietnam 32 Socio-economic indicators of the first months in the year 33 Table 2.6 2011 against the same period in 2010 Table 2.7 Structure of mobilized capital of MB Dien Bien Phu 43 Table 2.8 Lending state in MB Dien Bien Phu 45 Table 2.9 Structure of lending outstanding in MB Dien Bien Phu 46 Comparison table of MB Dien Bien Phu with some rivals 53 Table 2.10 operating in same area Table 2.11 SWOT matrix of MB Dien Bien Phu 56 Table 3.1 60 The growth target of MB Dien Bien Phu (2011 – 2015) vii LIST OF APPENDICES No Name of appendices 01 The customer survey questionnaires 02 The list of VIP customers of MB in general and Dien Bien Phu Branch viii Page 99 101 LIST OF ABBREVIATIONS No Abbreviations Full name MB Military Commercial Joint Stock Bank ASEAN Association of Southeast Asian Nations ACB Asia Commercial Joint-Stock Bank CBNV Staff CNTT Information Technology GDP Gross Domestic Product HSBC Hong Kong and Shanghai Bank IMF International Monetary Fund NHNN State Bank of Vietnam 10 NHTM Commercial Bank 11 R&D Research & Development 12 SACOMBANK Saigon Thuong Tin Commercial Joint Stock Bank 13 TECHCOMBANK Vietnam Technological and Commercial Joint- stock Bank 14 TNHH Limited Liability 15 USD United States Dollar 16 WTO World Trade Organization ix other transaction offices to improve competitive capability with other banks in the same area Continue to research and conduct survey to expand network of transaction offices at more reasonable scale to approach to customers more conveniently It is estimated that MB will open more 15 new transaction offices by 2015 Reorganize the structure towards modern, orderly and flexible model which are more suitable with business operation of the modern Bank 3.2.2 Build up corporate culture Currently, there is an increasing trend in which personnel in this commercial bank move to other bank and to other fields such as security, insurance, financial companies In addition to the increase of turnover, MB Dien Bien Phu Branch needs to build up its own image, and traditional characters in order to attract the attention of qualified personnel and the existing human resources to be loyal to the Branch In fact, many people accept to leave this job to move to another job of which salary is not as high as salary of the previous job but it is more suitable for them It demonstrates that when the living conditions improve, the matter “rice, cloth, and money” is not the only pressure for the personnel to select a job, especially the experienced and high qualified personnel What they need is a working environment where there is unbiased recruitment mechanism and in which they can be assigned suitable works by their boss so that they can promote their ability be viewed accurately In the context of integration and competitiveness like today, corporate culture is more and more important and influencing in the existence and development of the enterprise 3.2.3 Human resource development solution It is vital for MB in general and MB Dien Bien Phu Branch in particular to train its personnel Because personnel are categorized into parts: inexperienced personnel and experienced personnel It is essential to train and give the instructions 89 of their work when they are newcomers On the other hand, for experienced personnel, it is needed to develop their skill and create favorable conditions for them to improve more initiative in their work Invest in the health caring services for the personnel, arrange the suitable policy for them on the annual holiday; Ensure to pay the personnel’s salary on time; Ensure the reward policy in accordance with the regulations of MB system Create the favorable conditions for personnel to take part in the short – term training course at Head Office; build up a friendly bank culture; create the favorable conditions for the personnel to develop their creative capacity through contests such as the slogan writing competition, designing the birthday card for customers, Tet holiday card, sport contests, singing contest, It can organize a program to select the best customer care staff in the system every months Recruit new human resources who have experiences working in rival banks in order to perceive their management skill or treatment experience in business operation Continue to evaluate periodically the personnel in many aspects such as behavior culture, the capacity to master the work, the capacity to update the new knowledge in the field of banking From these above criteria, MB Dien Bien Phu Branch will have a suitable reward policy in order to encourage its own staff to work effectively, responsibly especially in customer satisfaction In addition, the leaders of Branch also need to establish strict penalty policy applied for breach of working regulations and business behavior violation in their Branch to avoid the behavior depravation, bone – sluggish in thinking and accumulating knowledge in some staff 3.2.4 Marketing Solution Based on the experiences learned from the other Banks, MB Dien Bien Phu Branch implement to improve and adjust the Marketing activities in accordance with the factual situation of our national economy and Vietnam Bank System MB 90 Dien Bien Phu is recommended to focus on marketing the products and services, create the particular feature The Branch has to identify that the human resources is the most important factor to achieve the target to develop banking services in general and marketing activities in particular Thus, The Branch needs to expand and improve the training of experts in the field of Bank Marketing It can cooperate with economic universities to seek for excellent candidates and recruit them In addition, The Branch can organize the workshops to discuss and exchange the experiences in the internal Branch and invite Marketing experts to train its personnel, create favorable conditions for staff having the marketing experience to attend marketing training courses It needs to identify the role of marketing activities in business operation of the Branch so as to be active in spending for marketing activity, avoiding overlapping of marketing activities among Branches in the MB System 3.2.5 Information Technology Solution MB Branch Dien Bien Phu and MB system share the common Information Technology (IT) network To ensure effectiveness for Information Security Management, the Branch needs to promulgate the general IT standards in the Branch; Improve the effectiveness of IT management in Branch, promulgate legal documents regulating problems in IT application; check and revise timely the activities which have not carried out checking activities based on risk orientation and assessment Launch the movement to contribute the initiative and ideas periodically every months in leaders and all personnel in the Branch as well Their ideas will be used and coordinated by IT staff to create the proper measures which perfecting the software system complying with changeable business requirements and high demands from the customers 91 3.2.6 Service and products solution Create product and service quality of payment meeting the international standards; mix many services to create the convenience for customer; diversify the products and services of payment; study products and services which have been implemented by rival Banks even including foreign Banks; survey and find out the detailed demands of local community and domestic enterprises to create suitable services Moreover, MB Dien Bien Phu needs to take the advantage of competent human resources and develop their creative capacity to have new, feasible and useful ideas applied for the Branch to improve the competitive capacity of services 3.2.7 Mobilization and lending solution Capital mobilization: Diversify the ways of capital mobilization and types of customer To better take advantage the deposit from all type of residents, MB Dien Bien Phu needs to improve the marketing program and directly contact or indirectly contact through means of mass media or customer conference It is essential for Dien Bien Phu Branch to classify the objects to give the proper and timely strategies of attracting the capital resulting from the habit of using money Based on the classified types of customer, MB Dien Bien Phu Branch has to give the particular methods to mobilize the stable capital resources For high income people who often care for interst rate, safety, security and long term period, the branch needs to have more different services to serve this group For people having regular income and put their saving into long term deposit, the branch needs to consult them to change to short term so as to bring highest interest for customers To mobilize the huge and stable capital resource, MB Dien Bien Phu Branch needs to cater the capital mobilization from residents and attracting the huge 92 companies at the same time Special deposit always has different maturity, in the event of the Bank know the customer’s plan how to using their money, the Branch is able to lend or invest in other business with the same maturity On the other hand, if the customers use the card and they also have to transfer money into their account, the Branch can utilize these capital resources in a longer period of time and ensure the capacity of payment Lending: Focus on investing in potential companies which have a safe growth rate, stable financial situation, feasible business strategy with effective business measures, experienced leaders In particular, the Branch needs to take care of the close type of customer Pay attention to investing in lending the small and medium sized enterprises, import and export enterprises, hi-tech companies with stable market 3.2.8 Risk management solution MB Dien Bien Phu Branch has to strengthen internal audit with the important target is to build up a system of searching potential negative, unstable and inefficient tendency in the operation of Branch to give the solutions Approved risks are authorized risks for each individual business after analyzing the details based on all specified aspects of State Bank System and MB When making a decision to implement the business, it is necessary to distribute properly the capital resources of the Branch at allowable risk level Strengthen the activities of organizing and training the managers and credit staff In order to limit the credit risk, MB Dien Bien Phu Branch must pay more attention to auditing the capacity of credit staff to review whether they obeying exactly the procedure Information about customer needs to be evaluated properly and efficiently Information about customer is one of important factors in credit risk management 93 Manager can take advantage of customer’s information to make necessary decisions about loan However, in addition to information provided by customers, MB Dien Bien Phu must collect more information from credit information providing agencies such as Credit Information Center of SBV and MB 94 Recommendation: For SBV: - Step by step innovate organizational structure, responsibility and function of State Bank System in order to improve the role and effectiveness of macro management of SBV in establishing and managing the national monetary policy and supervising and managing the operation of financial intermediaries - Restructure banking system; remove the domestic commercial bank protection, especially in credit activities and the refinancing mechanism, distinguish functions of commercial banks and state commercial banks, lending function of the policy bank and monetary business function of commercial bank Strengthen the selfcontrol and self-responsibility of commercial banks in business operation, remove subsidy for state commercial banks, apply adequately the international standards and regulations of safety in finance-banking field - It is essential to control more closely non-bank financial intermediaries because the Vietnam financial market has not developed as comprehensively as the developed countries in the world; national economy mostly consists of state group and State Corporation Thus, these non-bank financial intermediaries will cause many risks for Vietnam economy if they are not managed well, especially in the current period of unstable global economy situation, these financial organizations will take advantage of new derivative products to cause disadvantages for national economy such as financial hackers which is difficult to control - Consolidate and develop activities of bank service supply, build up and perfect the system including criteria to evaluate the safety and business effectiveness level of the Bank complying with international standards and the Vietnam’s factual situation 95 toward equal business environment establishment for all domestic and foreign financial institution - Basically revise foreign currency management regulations and exchange rate control regulation towards liberalization of current account transaction, controlling the transaction of capital account, create favorable conditions for Vietnam monetary to exchange freely, remove the limit of cross exchange, opening foreign currency account paid from other countries and using foreign currency in internal payment and saving -Build up a modern financial information system; ensure the bank system to operate safely, effectively and easy to be supervised 96 CONCLUSION Banking service is one of the basic services of the economy The development of banking products and services much relate to growth of sectors in the national economy and residents’ lives In the context of integration, competitiveness is considered to be the vital factor of each organization To compete in domestic market, MB in general and MB Dien Bien Phu Branch in particular, must strive more effort in reinforcing, improving the financial capacity, management level and the quality of human resources, applying modern technology to diversify services and products and boost the establishment of trademark in domestic and international market After more than 16 years of establishment and development, MB and MB Dien Bien Phu have achieved firm progress However, MB is still a small bank which lack of modern bank management experience in comparison with regional and international banks And due to limit in many aspects, our group only give some general solutions to perfect and improve the competitive capability of MB Dien Bien Phu based on the strong points, weak points, challenges and opportunities in the “power” correlation among domestic banks and the new trends of integration which banks need to aim at to gain position in the market Above is all content of the topic “Build up business strategies period 2011 – 2015 of Military Joint Stock Commercial Bank, Dien Bien Phu Branch” Although we have strive much effort, due to limited time and limited experience it is unavoidable to make certain mistakes and errors Thus we expect contributing ideas from Teachers and colleagues about this topic We would like to express our deeply thank to Instructor and Lecturer for their whole-hearted help for us to complete this task 97 REFERENCES Alex Miller (1998) Strategic Management 3rd Ed Irwin/McGraw-Hill Chandler, A (1962), “Strategy and Structure: Chapters in the History of the American Enterprise Cambridge ”, Massachusettes MIT Press Charles W.L Hill, Gareth R.Jones (2002) Strategic Management : An intergratedAproach, 5th Ed Houghton Mifflin Thai Ba Can, MA Tran Nguyen Nam (2004) “Developing Vietnam's financial market in the integration process”, Finance Publishing House Financial report in 2008;2009 and2010 of Dien Bien Phu branch Fred R.David, (2011), “Strategic management concepts and cases”, 13th Ed Statistical Publishing House Johnson, G., Scholes, K (1999) “Exploring Corporation Strategy”, 5th Ed Prentice Hall Europe Peter Wright, Mark J Kroll, John Parnell (1996), Strategic Management : Concepts and Cases 3rd Ed Prentice Hall 10 Quinn, J.B (1980) “Strategy for Change : Logical incrementalism” Homewood Illinois Irwin 11 R.E Hoskisson, M.A Hitt, W.P.Wan, and D.Yiu, (1982), “Theory and Research in Strategic Management: Swings of the Pendulum”, Journal of Business Vol25, No.3, pp 417-456 12 Thomas L Wheelen, J David Hunger (2004) Strategic Management and BusinessPolicy 9th Prentice Hall 13 Thompson Strickland, (1998) Strategic Management : Concepts and Cases, 10 th Ed.Irwin/McGraw-Hill 14 Articles and data on the following websites: 98 - www.acb.com.vn - www.gso.gov.vn – Website of General Statistics Office - www.mbbank.com.vn - www.mof.gov.vn – Website of Ministry of Finance - www.vir.com.vn – Website of Investment Newspaper - www.vneconomy.vn – Website of Vietnam Economic Times - www.sacombank.com.vn - www.sbv.gov.vn – Website of the State Bank of Vietnam REFERENCES Chandler, A (1962) Strategy and Structure: Chapters in the History of the American Enterprise Cambridge, Massachusettes MIT Press Quinn, J.B (1980) Strategy for Change : Logical incrementalism Homewood Illinois Irwin Johnson, G., Scholes, K (1999) Exploring Corporation Strategy, 5th Ed Prentice Hall Europe R.E Hoskisson, M.A Hitt, W.P.Wan, and D.Yiu, (1982), “Theory and Research in Strategic Management: Swings of the Pendulum”, Journal of Business Vol25, No.3, pp 417-456 Strategic management concepts – Fred R.David Statistical Publishing House Vice Professor – Doctor Thai Ba Can, MA Tran Nguyen Nam (2004) Developing Vietnam's financial market in the integration process, Finance Publishing House Articles and data on the following websites: - www.sbv.gov.vn – Website of the State Bank of Vietnam - www.gso.gov.vn – Website of General Statistics Office - www.mof.gov.vn – Website of Ministry of Finance - www.vir.com.vn – Website of Investment Newspaper 99 - www.vneconomy.vn – Website of Vietnam Economic Times Some websites of joint- stock commercial banks: www.mbbank.com.vn, www.acb.com.vn, www.sacombank.com.vn, www.techcombank.com.vn,… Appendix 01: Sample of the customer survey questionnaires: The customer survey questionnaires Please take a few moments you to choose different answers for the questions below Answer by marking the boxes in ascending order from 1-10 In your opinion, which bank has the best distribution network? a ACB b MB c Sacombank d Techcombank a b c d Which bandname is the most prestigious? ACB MB Sacombank Techcombank In terms of technology used in the transaction: In your opinion, which bank applies the best technology (online banking interface is friendly, easy to use, and utility, etc) a ACB b MB c Sacombank d Techcombank In the products of banks above, which bank has the highly utility and plentiful products? 100 a b c d ACB MB Sacombank Techcombank In your opinion, which bank has the best quality of services? a b c d ACB MB Sacombank Techcombank Which bank has the most competitive service price? a b c d ACB MB Sacombank Techcombank Which bank has the high qualified staff, and good customer care services? a b c d ACB MB Sacombank Techcombank In your opinion, which bank has the dominant corporate culture, leaving a good impression with customers? a ACB b MB c Sacombank d Techcombank Thank you for your enthusiatic participation in the survey Hope for the results of the survey, we will serve you better! 101 Thanks and best regards! Appendix 02: The list of VIP customers of MB in general and Dien Bien Phu Branch Thang Long Securities Company Viettel Corporation MB Real Estate Stock Company Viet REMAX Corporation MB Fund Management Stock Company Finance Bureau – Ministry of National Defence GAET Company Head departments directly under Ministry of National Defence Construction companies within Ministry of National Defence 10 Vietnam National Coal and Mineral Industries Group ……………………………………………… These are big customers and organizations, the transaction density and frequency in MB system are high / 102 ... Vietnam 10 NHTM Commercial Bank 11 R&D Research & Development 12 SACOMBANK Saigon Thuong Tin Commercial Joint Stock Bank 13 TECHCOMBANK Vietnam Technological and Commercial Joint- stock Bank 14 TNHH... must face to many problems such as: migration storm from the rural to the urban, causing a sex imbalance as well as improvement of women’s role in the society Scale and structure of population